Hospitality Group's Rescue Deal Preserves Core Business While Cutting Hundreds of Positions
In a dramatic restructuring of the UK's hospitality landscape, nearly 600 jobs are set to disappear following a last-minute rescue agreement for the company behind Revolution Bars. The deal, announced on Tuesday 27 January 2026, will see more than twenty venues close with immediate effect as administrators work to salvage what remains of the struggling business.
Separate Acquisitions Save Majority of Operations
Administrators for Revel Collective, the AIM-listed hospitality group that operates both Revolution Bars and the Peach pubs chain, confirmed that two distinct transactions have been arranged to sell off the company's separate bar and pub portfolios. This strategic move has preserved more than 1,500 positions across forty-one venues that will continue trading under new ownership.
The Revolution Bars and Revolution de Cuba brands have been acquired by Neos Hospitality, the operator behind Circuit night clubs, while the Peach pubs chain has been taken over by experienced hospitality entrepreneur Ted Kennedy. These acquisitions represent a lifeline for the majority of the business, though significant casualties remain unavoidable.
Immediate Closures Across Multiple Brands
The restructuring will result in the immediate shuttering of twenty-one sites, comprising fourteen Revolution bars, six Revolution de Cuba venues, and one Peach pub. These closures directly impact 591 employees who will lose their positions as part of the rescue arrangement.
FTI Consulting, the appointed administrators, explained the challenging circumstances that led to this outcome: "The businesses have faced a sustained period of challenging economic conditions including subdued consumer confidence, particularly amongst younger guests, and the cumulative impact of changes to employer NICs thresholds, minimum wage increases and duty on spirits."
Financial Pressures and Failed Negotiations
Revel Collective's financial difficulties became increasingly apparent in recent months, with shares suspended on Monday as the company warned of its intention to appoint administrators. The hospitality group reported revenue of £117.1 million for the year ending June 2025, representing a like-for-like decline of 7.9 percent compared to the previous year.
Chief executive Rob Pitcher highlighted the ongoing challenges facing the sector: "Guests in our bars continue to face cost challenges and the late-night sector remains challenging for many participants." The company had previously attempted to diversify its operations through the £16.5 million acquisition of Peach Pubs in 2022, but this strategic move proved insufficient to overcome broader market pressures.
Earlier efforts to secure the business included a sale process launched in May 2024 and a merger proposal from listed bar owner rival Nightcap, which was ultimately rejected. Nightcap later expressed disappointment at the failed negotiations, highlighting the competitive tensions within the hospitality sector.
Broader Hospitality Crisis and Policy Implications
The mass closures at Revolution Bars represent a symbolic blow to recent business rates reforms announced in the Budget, with industry officials expressing concern about the cumulative impact of taxation changes on hospitality businesses. Tax minister Dan Tomlinson is expected to announce temporary support measures worth up to £300 million for pubs following fierce backlash from the sector.
Political tensions surrounding the new tax scheme reached a climax when Labour member Rachel Maskell questioned the Prime Minister about urgent action needed to support pubs facing substantial tax increases. The 'Wonky Table' campaign saw hundreds of publicans banning Labour MPs from their establishments in protest against the proposed changes.
Sector-Wide Challenges and Consumer Pressures
According to consumer intelligence firm NIQ, the hospitality sector experienced 382 fewer licensed premises at the end of December compared to three months prior, equivalent to approximately four closures per day. Casual dining sites and restaurants were particularly hard hit, recording 241 closures during this period, while pubs of all varieties also saw a reduction in operating sites.
NIQ analysts identified multiple contributing factors to the sector's difficulties, including food inflation, higher labour costs resulting from minimum wage increases and employers' national insurance changes, and suppressed consumer confidence. These economic headwinds have created a perfect storm for hospitality businesses already struggling with changing consumer habits and increased operational costs.
The Revolution Bars rescue deal therefore represents both a survival strategy for the core business and a sobering reflection of the broader challenges facing UK hospitality operators in the current economic climate.
